Fresenius Kabi, a subsidiary of the health care group Fresenius, continues to expand its market position in central and eastern Europe. The European market leader in infusion and nutrition therapy today signed an agreement to acquire Infusia a.s., Horatev, a Czech manufacturer of infusion and parenteral* nutrition solutions.

Infusia a.s. markets its products in the Czech Republic, Slovakia and other eastern European countries and can look back on a history spanning more than 70 years. The Group is well-known in the region and expects sales in 2004 of about 10 million euros.

A modern production site in Horatev, about 50 kilometers east of Prague, meets all the quality standards of European pharmaceutical regulators.

With the acquisition of Infusia a.s., Fresenius Kabi will become one of the leading suppliers in the infusion solution and clinical nutrition segments in the Czech Republic and Slovakia.

Fresenius Kabi has around 11,400 employees in more than 30 countries. Sales of 1,463 million Euros were achieved in 2003, generating an operating profit of 147 million Euros.
With it's philosophy "Caring for life" and a broad product and service portfolio, the company aims at improving the quality of life of patients all over the world. Fresenius Kabi's core product range comprises infusion solutions for fluid substitution, blood volume expansion and parenteral nutrition, as well as products for enteral nutrition. Furthermore the company provides concepts for ambulatory health care and is focused on managing and providing home therapies. Fresenius Kabi AG is a 100% subsidiary of the health care group Fresenius AG.

* Providing intravenous nourishment

Fresenius Kabi is well positioned for continued above-average growth in the coming years. Fresenius Kabi AG management emphasizes this today during a Capital Market Day where the Company presents its business activities, strategy and growth prospects. Fresenius Kabi, a subsidiary of the health care group Fresenius, has become the market leader in infusion therapy and clinical nutrition in Europe and emerging markets. The financial results reflect this growth: Fresenius Kabi's contribution to the Fresenius Group's net income more than tripled between 2002 and 2004 (when comparing nine-month figures), climbing from 15 % (13 million euros) to 46 % (57 million euros). "Fresenius Kabi is an important growth driver for the Fresenius Group," says Dr. Ulf M. Schneider, Chairman of the Management Board of Fresenius AG. Future growth potential also lies in the expansion of the I.V. drug (intravenously administered drug) portfolio, which today accounts for about 100 million euros in sales for Fresenius Kabi.

Striving for a 2007 EBIT margin of 15 %
Fresenius Kabi's dynamic growth was made possible by a strong international focus as well as a specialization in infusion and nutrition therapy for patients in hospital and the outpatient environment. Since 1995, sales have grown at 19 % CAGR while EBIT grew at 26 % CAGR. Even when excluding acquisitions, the Company expects mid-term organic sales growth in the mid-single digit range. Profitability should also increase with Fresenius Kabi forecasting an EBIT margin of 15 % in 2007. For fiscal 2004, Fresenius Kabi confirms an EBIT margin of more than 11.5 % and expects organic sales to grow in the mid-single digits.

Exceptional position in Clinical Nutrition and Infusion Therapy
Since the 1960s Fresenius Kabi has significantly influenced the development of parenteral as well as enteral nutrition and is the only company that offers products for both internationally. Fresenius Kabi is able to offer a comprehensive nutrition therapy for hospital doctors as they, for example, switch patients from parenteral to enteral nutrition during recovery or stabilization. Fresenius Kabi can also rely on decades of scientific expertise in infusion therapy and build on successful products: Voluven® for example today sets international standards for blood volume substitution.
With the exception of Japan and the U.S., Fresenius Kabi markets its products worldwide. With a market share in infusion therapy and clinical nutrition of 21 %, the Company has an impressive lead on the nearest competitor*. Fresenius Kabi estimates the value of this market (global market excluding the U.S. and Japan) at 6.3 billion euros.

Leading in Europe, strong roots in Germany
The health care markets in Europe (excluding Germany) and Canada account for 51 % of Fresenius Kabi's overall sales while the domestic market, which accounts for 27 % of sales, highlights the Company's strong roots. Fresenius Kabi is the market leader in infusion therapy and clinical nutrition in Germany as well as in Europe and its German market share is double that of its closest competitor. In Europe and Canada, Fresenius Kabi expects sales to grow at mid-single digit rates and EBIT to grow stronger than sales. In the future, special attention will be paid to the new markets in Eastern Europe where the Company already holds a leading position. That position was further strengthened by the acquisition of Czech Infusia a.s. announced on December 7, 2004 Fresenius Kabi has a global network of 49 sales organizations and 34 production sites that supply their local markets.

Growth markets yielding excellent growth rates
Fresenius Kabi expects strong organic growth in fiscal 2004 in the Asia-Pacific region (+24 %) as well as in Latin America and South Africa (+14 %). Demographic developments and an improved ability to finance better health care are pushing demand higher in these countries. The regional production and sales networks allow Fresenius Kabi to service this demand with high-quality products. The Company is market leader in both infusion therapy and clinical nutrition. In the future, Fresenius Kabi expects organic sales growth of between 15 % and 20 % p.a. in these markets.

China: Market share of 24 %
Growth is especially strong in China, where Fresenius Kabi has become the fifth-largest foreign pharmaceutical company. When founded in 1982, the Sino Swede Pharmaceutical Corporation, which is 51%-owned by Fresenius Kabi, was the first pharma joint venture ever in the People's Republic with foreign ownership. The company employs 740 people and is specialized in clinical nutrition. A second joint venture, the Beijing Fresenius Kabi Pharmaceutical Corporation, which is 65 %-owned by Fresenius Kabi, produces infusion solutions and I.V. drugs with 350 employees. Fresenius Kabi is the leader in clinical nutrition in China with a market share of 24 %. In the past four years, the Company achieved a 20 % sales CAGR. In the third quarter of 2004, Fresenius Kabi introduced two important products to the Chinese market: the parenteral nutrition bag Kabiven® and the blood volume substitute Voluven®.


Background: Fresenius Kabi activities
Infusion therapy - Standard infusion solutions, colloids, I.V. drugs as well as medical devices and disposable products

Infusion solutions and colloids are used to compensate for fluid and blood loss. Standard infusion solutions contain mainly salts (electrolytes) as well as water and are used to offset water and electrolyte imbalances in cases such as dehydration, lack of salt or a lack of specific minerals in the blood. The main indication is the treatment of patients suffering from blood loss due to accident
or surgery. Colloids can present a safe alternative to blood transfusions after accidents or surgery and Fresenius Kabi produces and develops hydroxyethyl starch solutions such as HAES-steril® and Voluven®, which use corn-based raw materials. In addition, Fresenius Kabi offers I.V. drugs such as anesthetics (e.g. Propofol Fresenius), pain relievers and antibiotics. The infusion solution product portfolio also includes medical devices and disposable products (such as cannulae, tubes and pumps) that are used to administer infusion solutions and I.V. drugs.

Clinical nutrition - enteral using the intestines and parenteral using the veins

Fresenius Kabi produces infusion solutions for parenteral nutrition that contain all key nutritional components: carbohydrates, protein, fats, vitamins, trace elements and salts. While this solution is injected directly into the blood stream, liquid enteral nutrition is administered as sip or tube feed. Enteral nutrition also contains all the necessary components with a balanced number of calories. Nutrition therapies can prove useful after accidents or surgery, in cases of malnourishment or in cancer patients.

Transfusion technology
In the field of transfusion technology, Fresenius Kabi offers a comprehensive range of equipment for the production and processing of blood products for blood donation and blood banks.

 

*All market data in this release: Fresenius Kabi Internal Research

Bad Homburg, Germany - December 13, 2004 -- Fresenius Medical Care AG ("the Company") (Frankfurt Stock Exchange: FME, FME3) (NYSE: FMS, FMS-p), the world's largest provider of Dialysis Products and Services, today announced the successful closing of the refinancing of $1.2 billion senior credit facilities. A tranche of $750 million revolving facility and a tranche of $450 million term loan have now been extended to February 28, 2010. The total size of these facilities could be reduced from the prior amount of $1.4 billion to now $1.2 billion. This was achieved based on the favorable Cash Flow development of the Company, which resulted in a lower debt level.

The mandated lead arrangers Bank of America, Credit Suisse First Boston and Deutsche Bank have syndicated the facilities. The facilities were substantially oversubscribed due to strong support of the bank group with 37 commitments in total. The improved credit quality of Fresenius Medical Care and the favorable market conditions will result in a substantial reduction of interest expense commencing in 2005 going forward.

Fresenius Medical Care AG (Frankfurt Stock Exchange: FME, FME3) (NYSE: FMS, FMS_p), the world's largest provider of dialysis products and services, today announced that it has signed a privatization contract in Romania providing products and services to more than 500 patients in this emerging European market. FME is the market leader in the provision of dialysis services in Eastern Europe where it then treats over 7,000 Hemodialysis patients and has a strong presence in markets such as Poland, Hungary, Slovenia, Slovakia, Estonia and Turkey. As a fully vertically integrated provider, Fresenius Medical Care offers innovative systems, patient therapy solutions, know-how and expertise for End Stage Renal Disease patients and the healthcare systems in these rapidly growing markets.

Dr. Emanuele Gatti, Chief Executive Officer for the regions Europe, Middle East and Africa, commented: "We are very pleased with this development having seized market opportunities that provide for good growth in these key European markets. Our patients and the healthcare systems at large clearly benefit from our fully vertically integrated system and our innovative cost efficient technologies."

Bad Homburg, Germany - Fresenius Medical Care AG (Frankfurt Stock Exchange: FME, FME3) (NYSE: FMS, FMS_p), the world's largest provider of dialysis products and services, and its United States subsidiary Fresenius Medical Care Holdings, Inc. ("FMCH") (OTC: FSMEM.OB, FSMEN.OB, FSMEO.OB and FSMEP.OB), today announced the exercise of FMCH's right to redeem all of the outstanding shares of the Class D Preferred Stock (the "Class D Shares") of FMCH.*

The Class D Shares were issued to the common shareholders of W.R. Grace & Co. in connection with the 1996 combination of the worldwide dialysis business of Fresenius AG with the dialysis business of W.R. Grace to form Fresenius Medical Care AG. The Class D Shares trade in the National Association of Security Dealer's OTC Bulletin Board under the symbol "FSMEP.OB".

J.P. Morgan Chase Bank will serve as the payment and redemption agent for the redemption.

Class D Shares that have been properly transmitted to, and received by, the redemption agent will be redeemed commencing on March 28, 2003 at a redemption price of $0.10 per share. FMCH intends to redeem the 89 million outstanding Class D Shares at a total cash outflow of approximately $9 million. This transaction will have no earnings impact for the Company.

FMCH will arrange to mail to each Class D Shareholder of record as of February 11, 2003 a written notice of the redemption together with instructions for transmittal of Class D Share certificates to the redemption agent.

The Company confirms adequacy of accrued reserve

Bad Homburg, Germany – Fresenius Medical Care AG ("the Company") (Frankfurt Stock Exchange: FME, FME3) (NYSE: FMS, FMS_p), the world's largest provider of dialysis products and services, today announced that it has signed a definitive agreement with the official committees of asbestos creditors for the settlement of all fraudulent conveyance and other claims related to the bankruptcy of W.R. Grace & Co.

Under the terms of the definitive agreement, fraudulent conveyance and other claims raised by the asbestos committees on behalf of the Grace bankruptcy estates will be dismissed with prejudice upon confirmation of the W.R. Grace & Co. bankruptcy reorganization plan. In addition, the Company will also receive protection against all current and future W.R. Grace-related claims including fraudulent conveyance, asbestos and income tax claims relating to the non-NMC members of the W.R. Grace & Co. consolidated tax group.

This definitive agreement supersedes the terms of the earlier agreement in principle announced on November 29, 2002, under which the Company would have paid $ 15 million to the W.R. Grace bankruptcy estate upon plan confirmation and also retained responsibility to resolve the outstanding pre-merger income taxes of the W.R. Grace & Co. consolidated group. Payments and expenses under those previous terms were expected to remain within the amount reserved by the Company in the fourth quarter 2001.

In the definitive agreement announced today the Company has agreed to pay in total $ 115 million to the W.R. Grace bankruptcy estate or as otherwise directed by the court upon plan confirmation. Consequently, the Company is relieved of the burden of resolving W.R. Grace's tax obligations and can confirm the adequacy of it's accrued reserve. No admission of liability has been or will be made. As part of the W.R. Grace Chapter 11 proceeding, the definitive agreement will be submitted to the court for approval.

Ben Lipps, Chief Executive Officer of Fresenius Medical Care, commented: "The terms of this definitive agreement provide certainty and finality for Fresenius Medical Care upon plan confirmation. This settlement not only avoids the costs of expensive and distracting fraudulent conveyance litigation, but also relieves Fresenius Medical Care of the burden of resolving the tax liabilities of the W.R. Grace consolidated group. We are indeed pleased to have this behind us and we now look forward to focusing all of our energies on bringing innovative therapies to the treatment of kidney disease."

• Sales: + 3 % to € 7.5 billion
  currency-adjusted: + 9 %
• EBIT: + 10 %^* to € 837 million
• Net income: + 44 %* to € 134 million Dividend: + 10 % to € 1.14 per ordinary share and € 1.17 per preference share

The Fresenius health care group increased sales in the 2002 financial year by a plus of 3 % to € 7,507 million. Calculated at the exchange rates of the previous year the sales increase amounted to 9 %. Net income of the Fresenius Group increased by 44 % to € 134 million. This increase resulted from goodwill no longer being amortized in accordance with the changes in the US GAAP accounting rules effective since January 1, 2002.

^* Comparable figure without special charge for US legal issues

Dividend
The Managing Board will propose to the Supervisory Board that the dividend be increased. This also reflects our strong belief in the future earnings development. A dividend of € 1.14 (2001: € 1.03) per ordinary share entitled to dividend, and of € 1.17 (2001: € 1.06) per preference share entitled to dividend is to be paid. This corresponds to an increase of 11 % per ordinary share and 10 % per preference share, and a total payment of € 47.3 million.

Group outlook on year-end 2003
The Fresenius Group is in an excellent strategic position worldwide. Thanks to its leading market positions in many of its fields of activity, Fresenius has a solid basis for growth in the future, supported by new products and therapies. Despite the difficult economic development and sustained pressure to save costs in the health systems, especially in the western health care markets, the Group expects a positive development in the 2003 financial year. At the exchange rates in force during 2002, a high single-digit sales growth rate is expected for the 2003 financial year. This is an ambitious target in view of the absolute sales figure of € 7.5 billion achieved in 2002, and since Fresenius has to exceed market growth. Earnings are also expected to further increase at constant exchange rates: The growth rate in net income will be higher than that of sales.

Sales
In the 2002 financial year, Fresenius increased consolidated sales to € 7,507 million (+ 3%). A continued strong organic growth of 6 % again confirms the good position of Fresenius in the markets. Acquisitions increased growth by 3 percentage points. The changes in exchange rates had an effect of -6 percentage points. The devaluation of the Argentinean peso, and in particular the weaker US dollar compared to the euro
(- 5.6% on average over the year) negatively affected sales in the currency conversion.

The strongest regions of the Group from a sales point of view continue to be North America with 54 % and Europe with 34 % of total sales, followed by the region Asia-Pacific with 8 % and Latin America and other regions with 4 %. Fresenius achieved sales increases in all regions of the world on a currency-adjusted basis: High growth rates were achieved particularly in the region Asia-Pacific. Despite the difficult economic situation in Argentina and Brazil, sales in Latin America rose by 11 % currency-adjusted.

The breakdown of sales by business segment compared to the previous year changed in the favour of Fresenius ProServe, since Wittgensteiner Kliniken AG which was acquired effective June 1, 2001 was consolidated for a whole year for the first time in 2002.

Earnings
In the 2001 financial year Fresenius Medical Care had taken a special charge for expenses in connection with legal disputes in the United States relating to the National Medical Care transaction in 1996. In order to make it easier to compare the development of the Group, the following report includes comments on the previous year's figures without this special charge.

Earnings of the Fresenius Group were influenced in the 2002 financial year by two main factors: On the one hand, goodwill was no longer amortized as a result of the change in US GAAP accounting rules as of January 1, 2002, which had a positive effect on earnings. On the other hand, there were negative impacts on earnings through expenses in the production facilities and in the services field in connection with the conversion of dialysis treatment from re-use to single-use dialysers by Fresenius Medical Care in the United States.
Consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to € 1,178 million and were 6 % (1 % at constant exchange rates) lower than the previous year's figure. The EBIT growth rate, 10 % to € 837 million, resulted from goodwill no longer being amortized. If EBIT of the year 2001 before special charge does not include goodwill amortization, EBIT of 2002 would have been 8 % (currency-adjusted: 4 %) lower. The goodwill in the Fresenius Group's balance sheet has substance.

Net interest of the Group amounted to € -270 million and improved in the 2002 financial year by 6 % (2001: € -286 million). The conversion of interest expenses from US dollars to euros had a positive effect, since a large portion of bank loans were granted in the United States. Furthermore, the redemption of the high-interest trust preferred securities due in 2006 of Fresenius Medical Care reduced the interest expense.

The tax ratio dropped from 42.6 % in 2001 to 37.0 % in the year under report, largely caused by goodwill no longer being amortized.

The share of earnings allocated to minority interests increased to € 218 million, after € 180 million in the 2001 financial year. Of this amount, 94 % of minority interests concern Fresenius Medical Care.

Net income increased to € 134 million compared to € 93 million in 2001.

Earnings per share amounted to € 3.27 after € 2.29 in the previous year, based on a total of 40,969,684 ordinary and preference shares.

The changes in currency exchange rates negatively influenced the earnings situation of the Group through translation effects: At constant exchange rates, i.e. calculated at the 2001 exchange rates, EBIT would have increased by 15 % and net income by 53 %.

Capital expenditure
Fresenius invested € 507 million in the year under report. This is 7 % of total consolidated sales. In the previous year the investment was € 1,233 million (17% of sales), strongly marked by acquisitions. With the number of acquisitions in the recent years Fresenius was able to achieve leading positions in its markets. These considerable efforts have been carried out to secure future growth.

While investments in tangible and intangible assets decreased by € 52 million to € 377 million, funds provided for acquisitions dropped substantially to € 130 million from € 804 million in 2001. Of the total amount invested in the year under report, 74 % was allocated to tangible and intangible assets and 26 % to acquisitions.

Acquisitions mainly concerned the purchase of dialysis clinics by Fresenius Medical Care. Major investment projects in the field of tangible assets were the founding and equipping of dialysis clinics, mainly in the United States, as well as the extension and modernisation of existing clinics, the building of a joint production facility in Mexico for infusion solutions of Fresenius Kabi and peritoneal dialysis products of Fresenius Medical Care. In addition, Fresenius Kabi's European production plants for infusion solutions continued to be build up and optimised.

Split into business segments, Fresenius Medical Care invested 68 % of the total amount, followed by Fresenius Kabi with 15 %. By region, 49 % of investments were made in Europe, followed by North America with 35 % and the regions Asia-Pacific and Latin America with 8 % each.

Cash flow
The cash flow statement of the Group developed extremely well. The operating cash flow and free cash flow showed high growth rates.

The operating cash flow amounted to € 697 million in the year under report (€ 509 million in 2001). This corresponds to an increase of 37 %. It fully covers the financing requirements from investment activities before acquisitions: Funds provided for investments of the Group amounted to € 377 million and proceeds from disposals of fixed assets amounted to € 62 million. The free cash flow before acquisitions and dividends amounted to € 382 million and was three times higher than the figure for the previous year due to the significantly lower capital expenditure and improved working capital management. All acquisitions and the dividends for 2002 were able to be financed from the free cash flow. The free cash flow after acquisitions and dividends was positive and amounted to € 163 million.

Asset and equity structure
The balance sheet total of the Group dropped by € 952 million (10 %) compared to 31.12.2001 to € 8,915 million. This decrease is solely a result of currency effects. At constant exchange rates the balance sheet total increased only slightly, by 1 % over the previous year. This reflects the reduced acquisition activity of the Group and improvements in current assets.

The liabilities side of the balance sheet shows a decrease in equity including minority interests of 9 % to € 3,369 million (2001: € 3,689 million). This is largely due to the change in exchange rates; currency-adjusted the increase would have been 4 %. The equity ratio including minority interests increased marginally from 37.4 % as of 31.12.2001 to 37.8 % at the end of the year under report.

The liabilities of the Group from bank loans, Eurobonds, commercial papers and trust preferred securities totalled € 3,283 million on 31.12.2002; this corresponds to a drop of € 454 million compared to the previous year's figure of € 3,737 million. The decrease resulted to a large extent from the changed exchange rates in the translation into euros of the US dollar loans. € 175 million financial liabilities were repaid in the year under report.

The Business Segments

Fresenius Medical Care
In 2002, Fresenius Medical Care further expanded its market position in dialysis. As of 31.12.2002 Fresenius Medical Care treated around 112,200 patients in 1,480 dialysis clinics, 6 % more than in the previous year. In Europe, Latin America and the region Asia-Pacific growth rates were registered that were substantially higher than those of the market. As a result of the introduction of single-use dialysers the growth rates in North America were lower than anticipated. The switch from single-use dialysers however represents a major strategic step and the basis for future growth.

In 2002 Fresenius Medical Care increased sales by 5 % (currency-adjusted: 6 %) to US$ 5,084 million (2001: US$ 4,859 million). 74 % of sales were achieved in the United States, 18 % in Europe and 8 % in the other regions of the world.

The main growth driver was dialysis care, sales of which rose by 4 % to US$ 3,709 million (2001: US$ 3,557 million). The main reason for this growth was the increased number of dialysis treatments: Altogether Fresenius Medical Care performed 16.4 million dialysis treatments in the year under report, 7 % more than in the previous year. Sales of dialysis products amounted to 27 % of total sales of Fresenius Medical Care and rose by 6% to US$ 1,375 million (2001: US$ 1,302 million). If sales of products to company-owned dialysis clinics are included, sales reached US$ 1,776 million, which likewise corresponds to a 6 % increase.

Fresenius Medical Care increased EBIT by 8 % to US$ 695 million from US$ 644 million before special charge in the previous year (2001: goodwill-adjusted: US$ 765 million). The result was influenced by costs in connection with the switch from re-use to single-use dialysers in the United States.

For further information - see Investor News Fresenius Medical Care www.fmc-ag.com.

In the currency conversion into euros, the weakness of the dollar meant that sales of Fresenius Medical Care totalling € 5,378 million were 1 % lower than the previous year's figure of € 5,426 million. As far as EBIT is concerned, currency conversion resulted in an increase of 2 % to € 735 million (previous year: € 719 million before special charge).

Fresenius Kabi
Fresenius Kabi achieved sales of € 1,262 million, 1 % lower than the previous year's figure of € 1,277 million. The sales development was influenced to a large extent by shrinking sales of the company ProReha and its sale in August 2002 as well as lower sales in the manufacturing contract business. If these effects are not taken into account, Fresenius Kabi achieved an organic growth of 7 %, growing faster than the market. Acquisitions contributed 1 percentage point, currency effects reduced growth by 3 percentage points. The hospital business achieved a 76 % share of sales, namely € 959 million (2001: € 954 million). The Ambulatory Care Business, € 303 million, corresponded to 24 % of total sales (2001: € 323 million).

Fresenius Kabi achieved an EBIT amounting to € 91 million in the 2002 financial year compared to € 53 million in 2001 (goodwill-adjusted: € 63 million). The development of earnings was negatively affected in the 2002 financial year by measures to increase profitability at the factory in Uppsala, Sweden. Furthermore, losses made by the company ProReha, and its sale effective August 1, 2002, affected earnings. These expenses totalled € 27 million. The measures carried out in the year under report will make a substantial contribution towards the future development of earnings of Fresenius Kabi.

Fresenius ProServe
Fresenius ProServe was able to present a 55 % sales upswing: Sales amounted to € 701 million (2001: € 451 million). The healthcare business generated 80 % (€ 559 million) of total sales, and the pharma industry business € 142 million, or 20 %. Of the € 250 million increase in sales about € 100 million were generated organically and € 145 million were generated by acquisitions, mainly Wittgensteiner Kliniken AG which in 2001 only contributed seven months towards the total sales of Fresenius ProServe.

Orders received and orders on hand even exceeded the high level of the previous year: Orders received in the project business of Fresenius ProServe rose to € 327 million (2001: € 266 million); orders on hand reached € 424 million (2001: € 266 million). This corresponds to a plus of 23 % and 16 % respectively. Important orders were received by the healthcare business in the 2002 financial year. Fresenius ProServe was awarded engineering orders and turnkey projects for hospitals.

Fresenius ProServe achieved an EBIT of € 24 million in the year under report (2001: € 6 million; goodwill-adjusted: € 11 million). This significant increase is largely a result of the development in the healthcare business, particularly of the consolidation for the whole year of Wittgensteiner Kliniken AG.

Fresenius HemoCare
Fresenius HemoCare achieved sales of € 229 million in 2002 (2001: € 215 million). The 7 % increase is due to acquisition activities and organic growth. Currency conversion effects had an impact of -2 % on the sales development of Fresenius HemoCare.

EBIT of Fresenius HemoCare amounting to € 10 million was 25 % higher than the previous year's figure of € 8 million (goodwill-adjusted: € 10 million). Sustained high expenditure on research and development and the building up of the sales organisations had negative effects on earnings.

As from the 2003 financial year, the activities of the business segment Fresenius HemoCare were re-allocated within the Fresenius Group.

Accounting at the Fresenius Group has been in accordance with US GAAP since January 1, 2002. The figures for the previous year therefore correspond to the US GAAP accounting rules in force during 2001, i.e. the figures for 2001 include amortization of goodwill

Summary:

• Net income of $ 302 million after minorities and before extraordinary item
• Full-Year Free Cash Flow at record level of $ 349 million
• Outstanding success by achieving definite agreement in fraudulent conveyance case and confirming adequacy of accrued reserve (see Press Release Feb. 12, 2003)
• Implementation of the UltraCare™ program continues to show its fundamental strategic value while fourth quarter 2002 EBIT-margin has improved in North America
• Refinancing of the senior credit agreement completed
• Dividend increase proposed for the sixth consecutive time

The results in the year 2002 are based on the new accounting standards on Goodwill and Other Intangible Assets (FAS 142) which came into effect January 1, 2002. In order to facilitate a year-over-year comparison, goodwill adjusted key figures for the full-year 2001 and the fourth quarter 2001 are provided in the appendix.

Bad Homburg, Germany - February 25, 2003 -- Fresenius Medical Care AG ("the Company") (Frankfurt Stock Exchange: FME, FME3) (NYSE: FMS, FMS_p), the world's largest provider of Dialysis Products and Services, today announced the results for the fourth quarter and the full-year 2002.

OPERATIONS

Fourth Quarter 2002¹:
Total revenue for the fourth quarter 2002 increased 7% (8% at constant currency) to $ 1,358 million. Same store revenue growth at constant exchange rates was 7%. Dialysis Care revenue grew by 6% to $ 974 million (+9% at constant currency) in the fourth quarter of 2002. External Dialysis Product revenue increased by 9% to $ 384 million (+5% at constant currency) in the same period.
¹: FY 2001 figures exclude special charge of $ 258 million

North America:
Revenue rose 7% to $ 979 million, compared to $ 918 million in the same period last year. Dialysis Care revenue increased by 7% to $ 861 million. Same store treatment growth was 4%. The average revenue per treatment increased to $286 in the fourth quarter (Q3 2002: $282). Dialysis Product revenue, including sales to company-owned clinics, increased 2.4% to $ 197 million. Product sales to the available external market grew by 9.2%.

International:
Revenue was $ 378 million, up 11 % adjusted for currency. Dialysis Care revenue reached $ 113 million in the fourth quarter 2002 (+20% constant currency). Dialysis Products revenue, including sales to company-owned dialysis clinics, increased 10% to $ 292 million (6% constant currency).

Earnings before interest and taxes (EBIT) increased to $ 184 million resulting in an operating margin of 13.6%. The operating margin remained within the targeted range as the Company completed its 2002 rollout of the UltraCare™ dialysis treatment concept, including Fresenius Polysulfone high-flux single-use dialyzers, in North America.

Fresenius Medical Care AG reports a 36% increase in net income after minorities to $ 82 million for the fourth quarter 2002.

Earnings per share (EPS) in the fourth quarter 2002 rose 36% to $ 0.85 per ordinary share ($ 0.28 per ADS), compared to $ 0.62 ($ 0.21 per ADS) in the fourth quarter of 2001. The weighted average number of shares outstanding during the fourth quarter of 2002 was approximately 96.2 million, compared to 96.1 million in the same period of 2001.

In the fourth quarter of 2002, the Company generated $ 155 million in cash from operations. A total of $ 45 million (net of disposals) was spent for capital expenditures, resulting in record fourth quarter Free Cash Flow before acquisitions of $ 110 million. A total of $ 7 million in cash was spent for acquisitions. Free Cash Flow after acquisitions was $ 103 million. In the fourth quarter of 2001, Free Cash Flow after acquisitions was $ 50 million.

Full-year 2002²:
Net revenue grew by 5% to $ 5.08 billion. Adjusted for currency, net revenue rose 6% compared to 2001. Earnings before interest and taxes (EBIT) increased 8% to $ 695 million resulting in an operating margin of 13.7%. In the full-year of 2002, net income after minorities and before extraordinary item was $ 302 million, up 23% from the same period in 2001. The extraordinary item covers the cost of $12 million for the redemption of the entire US$ 360 million aggregate amount outstanding of its 9% Trust Preferred Securities due 2006 (see Investor News January 16, 2002).

²: FY 2001 figures exclude special charge of $ 258 million and prior quarter related expenses of $ 7 million

In the full-year 2002, earnings per ordinary share before extraordinary item rose 23% to $ 3.12. Earnings per ordinary ADS before extraordinary item for the full-year of 2002 were $ 1.04.

Fresenius Medical Care generated $ 550 million in cash from operations during the full-year of 2002, an increase of 30% from the previous year. Capital expenditures (net of disposals) were $ 201 million. Free Cash Flow for the full-year of 2002 was a record $ 349 million compared to $ 173 million in the previous year. Free Cash Flow for the full-year significantly exceeded the full-year target of $ 200 million set by the Company. This exceptional performance is primarily driven by significant improvements in working capital management, in particular accounts receivable collection, and by moderate capital expenditure. Net cash used for acquisitions was $ 80 million.

As of December 31, 2002, the Company operated a total of 1,480 clinics worldwide [1,080 clinics in North America and 400 clinics International]. In the Full-year 2002, the Company opened 90 new clinics (de novo's). Fresenius Medical Care AG performed approximately 16.4 million treatments, which represents an increase of 7% year over year. North America accounted for 11.6 million treatments (+4%) and the Iternational segment for 4.7 million (+16%). At the end of the fourth quarter 2002, Fresenius Medical Care treated about 112,200 patients worldwide, which represents an increase of 6%. North America accounted for ~79,600 patients (+4%) and the International segment for ~32,600 patients (+12%).

Credit Agreement
On February 21, 2003 the Company completed the refinancing of its senior credit agreement, which was scheduled to mature on September 30, 2003. The amended and restated Credit Agreement provides up to $ 1.5 billion through three credit facilities: a revolving credit facility of up to $ 500 million and a term loan facility "Loan A" of $ 500 million, both due on October 31, 2007.
The third tranche, a term loan facility "Loan B" for institutional investors of $ 500 million will be due after seven years. All three tranches were significantly over-subscribed.

The Credit Agreement provides the Company with a solid and reliable source of financing for the next years, with no significant debt maturing before 2007. The terms and conditions of the new Credit Agreement are fully reflected in the Company's reconfirmed outlook for 2003.

Dividends
Consistent with prior years the Company will continue to follow an earnings driven dividend policy. For the sixth year in a row, Shareholders can expect an increasing dividend for the fiscal year 2002. The Managing Board will propose to the Supervisory Board for the Fiscal Year 2002 a dividend of € 0.94 per ordinary share (2001: € 0.85) and € 1.00 per preference share (2001: € 0.91) for shareholders approval at the Annual General Meeting on May 22, 2003.

Outlook 2003
For the year 2003, the Company reconfirms it's outlook and expects mid single digit revenue growth before acquisitions (in constant currency) and net income growth in the high single digit to low double digits range.

Ben Lipps, Chief Executive Officer of Fresenius Medical Care, commented: "We are pleased to have achieved an operating margin improvement in North America in the fourth quarter of 2002. We also continued our momentum with strong fourth quarter cash flow performance and record Free Cash Flow for the full-year. In North America we completed our strategic objective of developing and implementing a unique and differentiated dialysis therapy based on Fresenius Medical Care's technology, which includes the UltraCare™ NR a program that uses the latest technology of single use high-fluxFresenius

Polysulfone dialyzers. Making this program cost neutral was an important milestone. We are well positioned in the United States where the net patient growth rate currently is in the range of 4-5%, and we believe this strategy provides for growth opportunities above market and new opportunities for future margin expansion. We are also positioned to succeed in a reimbursement environment that allows the provider to share in the healthcare savings achieved. In International, we continued to strengthen our position in both our patient care and products business. In our worldwide products business we achieved a growth rate of 6%, in constant currency, which exceeds the market growth rate and is a clear sign that our product technologies continue to be well received in the market place. Finally, I would like to thank all our employees again for their dedication to patient care and for their commitment to the Company's vision and values."

Fresenius announces change in chairmanship of Managing Board


The Supervisory Board of Fresenius AG announced today that Dr. Gerd Krick has decided to resign his position as Member and Chairman of the Managing Board of Fresenius AG at the close of the Annual General Meeting on May 28, 2003. It is planned that Dr. Krick (64) will then move to the Supervisory Board and succeed Dr. Karl Schneider as its Chairman. Dr. Gerd Krick will continue to be Chairman of the Supervisory Board of Fresenius Medical Care AG, thus further underlining his continued close ties with the Group.

"After two difficult years, we have brought Fresenius back onto the growth track. Fresenius has an outstanding position in the health care market and excellent perspectives. Therefore, now it is the right time to pass on the responsibility for the company to younger hands", commented Dr. Gerd Krick, who will turn 65 this year, his decision.

The departure of Gerd Krick from the Managing Board of Fresenius AG marks the end of an era of an extremely successful entrepreneurial personality: Krick was at Fresenius for 28 years. For 11 of these years he was the Chairman of the Managing Board. He had assumed this position as successor to Dr. Hans Kröner who had built up the company together with his wife. During Dr. Krick's term of office, sales of the Group increased tenfold to 7.5 billion euros at the end of 2002. Krick, with skill and strategic farsightedness, has made Fresenius an international group of companies; the company generates 87 % of its sales abroad. Under his management it was possible to constantly increase the dividend - the tenth consecutive dividend increase will be proposed to the Annual General Meeting this year.
"After Hans Kröner, Gerd Krick has put his stamp on Fresenius as nobody else has. We are indebted to him and are extremely pleased that he will continue to support the company as the Chairman of its Supervisory Board" said Dr. Karl Schneider (75). It is planned that Dr. Schneider will continue to be an ordinary member of the Supervisory Board.

In its meeting of today, the Supervisory Board unanimously decided to appoint Dr. Ulf M. Schneider (37) as the new Chairman of the Managing Board of Fresenius AG. Dr. Schneider will assume his new position after the close of the Annual General Meeting on May 28, 2003.

"Dr. Ulf M. Schneider has exceptional experience in the health care field and in international business. He has already proven his abilities as a member of the Managing Board of Fresenius Medical Care AG and is the right person to ensure that we will achieve our ambitions", said Dr. Gerd Krick.

Ulf M.Schneider has been Chief Financial Officer of Fresenius Medical Care AG since November 2001. He will resign from this position when he assumes the Chairmanship of the Managing Board of Fresenius AG. Previously, he was Group Finance Director of Gehe UK plc. in Great Britain that is part of the Haniel Group for which Dr. Schneider worked for twelve years. Schneider holds a degree in Finance and Accounting and a Ph.D. in Economics from the University of St. Gallen and an MBA from Harvard University.

Dr. Karl Schneider, Chairman of the Supervisory Board of Fresenius AG, commented on the appointment: "Dr. Ulf M. Schneider was likewise the first choice of the Supervisory Board. We are pleased that we have found an experienced executive for this task".

Fresenius Medical Care AG ("the Company") (Frankfurt Stock Exchange: FME, FME3) (NYSE: FMS, FMS_p), the world's largest provider of Dialysis Products and Services, announces today that Dr. Ulf M. Schneider (37) is resigning his position as the Chief Financial Officer (CFO) of Fresenius Medical Care AG and will become Chairman of the Management Board of Fresenius AG, where he will succeed Dr. Gerd Krick (64). On March 7, 2003, the Supervisory Board of Fresenius AG unanimously appointed Dr. Ulf M. Schneider to be the Chairman of the Management Board of Fresenius AG. Dr. Schneider will assume his new position upon the conclusion of the Annual General Meeting of Fresenius AG on May 28, 2003.

Dr. Schneider's successor as Chief Financial Officer of Fresenius Medical Care AG has not been determined yet. Dr. Ben J. Lipps, Chief Executive Officer of Fresenius Medical Care AG, will temporarily assume responsibility for financial matters in the event that a new CFO has not been appointed until May 28, 2003.

Dr. Ben J. Lipps, CEO of Fresenius Medical Care AG, stated with respect to this appointment: "First of all, I would like to sincerely congratulate Dr. Gerd Krick, who will be moving to the Supervisory Board of Fresenius AG. I am particularly pleased by the fact that Dr. Krick will continue to be the Chairman of the Supervisory Board of Fresenius Medical Care AG. Fresenius Medical Care AG can continue to benefit from Dr. Krick's outstanding knowledge and experience in the field of health care and dialysis. I wish to thank Dr. Ulf M. Schneider for his outstanding contribution. With this step, the continuity of the cooperation is ensured."